Office of Labor-Management Standards (OLMS)
U.S. Department of Labor Employment Standards Administration
Office of Labor-Management Standards
Buffalo District Office
130 South Elmwood Street
Buffalo, NY 14202-2465
(716) 842-2900 Fax: (716) 842-2901
September 29, 2008
Mr. James Suschinski, President
Communications Workers AFL-CIO
26 Osborne Road
Albany, NY 12205-3423
LM File Number 000-267
Dear Mr. Suschinski:
This office has recently completed an audit of Communications Workers Local 1113 under the Compliance Audit Program (CAP) to determine your organization's compliance with the provisions of the Labor-Management Reporting and Disclosure Act of 1959 (LMRDA). As discussed during the exit interview with you, Council A Vice President John Robinson, Council B Vice President Sheila Burke, Secretary Treasurer Sheila Carr, and Accountant Mary O'Connor on September 25,2008, the following problems were disclosed during the CAP. The matters listed below are not an exhaustive list of all possible problem areas since the audit conducted was limited in scope.
Title II of the LMRDA establishes certain reporting and recordkeeping requirements. Section 206 requires, among other things, that labor organizations maintain adequate records for at least five years by which each receipt and disbursement of funds, as well as all account balances, can be verified, explained, and clarified. As a general rule, labor organizations must maintain all records used or received in the course of union business.
For disbursements, this includes not only original bills, invoices, receipts, vouchers, and applicable resolutions, but also documentation showing the nature of the union business requiring the disbursement, the goods or services received, and the identity of the recipient(s) of the goods or services. In most instances, this documentation requirement can be satisfied with a sufficiently descriptive expense receipt or invoice. If an expense receipt is not sufficiently descriptive, a union officer or employee should write a note on it providing the additional information. For money it receives, the labor organization must keep at least one record showing the date, amount, purpose, and source of that money. The labor organization must also retain bank records for all accounts.
The audit of Local 1113's 2007 records revealed the following recordkeeping violations:
1. General Reimbursed and Credit Card Expenses
Local 1113 did not retain adequate documentation for general expenses and credit
card expenses incurred by union officers and employees totaling at least $1,205.54.
For example, documentation was not retained for disbursements made to the
Watervliet Elks Lodge for meeting hall rental. Also, no original receipts or invoices
were retained for some credit card expenses incurred by the executive Committee
members at The Resorts in Atlantic City during a leadership conference.
As previously noted above, labor organizations must retain original receipts, bills,
and vouchers for all disbursements. The president and treasurer (or
corresponding principal officers) of your union, who are required to sign your union's LM report, are responsible for properly maintaining union records.
2. Meal Expenses
Local 1113 did not require officers and employees to submit itemized receipts for
meal expenses totaling at least $161.58. The union must maintain itemized
receipts provided by restaurants to officers and employees. These itemized
receipts are necessary to determine if such disbursements are for union business
purposes and to sufficiently fulfill the recordkeeping requirement of LMRDA
Local 1113 records of meal expenses did not always include written explanations of union business conducted or the names and titles of the persons incurring the restaurant charges. For example, there were no notations made on some restaurant receipts from the Inferno Restaurant. Union records of meal expenses must include written explanations of the union business conducted and the full names and titles of all persons who incurred the restaurant charges. Also, the records retained must identify the names of the restaurants where the officers or employees incurred meal expenses.
3. Lost Wages
Local 1113 did not retain adequate documentation for lost wage reimbursement
payments to union officers and employees totaling at least $4,936.39. The union
must maintain records in support of lost wage claims that identify each date lost
wages were incurred, the number of hours lost on each date, the applicable rate of
pay, and a description of the union business conducted. The OLMS audit found
that Local 1113 officers did not identify the date lost wages were incurred, the rate
of pay, or a description of the union business being conducted on some lost wage
During the exit interview, we reviewed the expense voucher used by Local 1113.
We discussed the type of information and documentation that the local must
maintain for lost wages and other officer expenses.
4. Disposition of Gifts Purchased
Local 1113 purchased McDonald's gift cards in August 2007. The union retained
no records regarding the distribution of these gift cards totaling at least $100.
The union must track the distribution of give-away items and prizes; including
cash, gift cards, and raffle items.
5. Lack of Salary Authorization
Local 1113 did not maintain records to verify that the salaries reported in Item 24
(All Officer and Disbursements to Officers) of the LM-3 were in the authorized
amounts and therefore correctly reported. The union must keep a record, such
as meeting minutes, to show the current salary authorized by the entity or
individual in the union with the authority to establish salaries.
Based on your assurance that Local 1113 will retain adequate documentation in the
future, OLMS will take no further enforcement action at this time regarding the above
The audit disclosed a violation of LMRDA Section 201(b), which requires labor organizations to file annual financial reports accurately disclosing their financial condition and operations. The Labor Organization Annual Report (Form LM-3) filed by Local 1113 for fiscal year ending September 30, 2007, was deficient in that:
Local 1113 did not include some reimbursements to officers totaling at least $360.41 in the amounts reported Item 24 (All Officers and Disbursements to Officers). It appears the union erroneously reported payments to Verizon on behalf of James Suschinski in Item 48 (Office and Administrative Expense).
The union must report most direct disbursements to Local 1113 officers and some indirect disbursements made on behalf of its officers in Item 24. A "direct disbursement" to an officer is a payment made to an officer in the form of cash, property, goods, services, or other things of value. See the instructions for Item 24 for a discussion of certain direct disbursements to officers that do not have to be reported in Item 24. An "indirect disbursement" to an officer is a payment to another party (including a credit card company) for cash, property, goods, services, or other things of value received by or on behalf of an officer. However, indirect disbursements for temporary lodging (such as a union check issued to a hotel) or for transportation by a public carrier (such as an airline) for an officer traveling on union business should be reported in Item 48 (Office and Administrative Expense).
I am not requiring that Local 1113 file an amended LM report for 2007 to correct the
deficient items, but Local 1113 has agreed to properly report the deficient items on all
future reports it files with OLMS.
1. Expense Policy
As I discussed during the exit interview, the audit revealed that Local 1113 does
not have a clear policy regarding the types of expenses personnel may claim for
reimbursement and the types of expenses that may be charged to union credit
cards. OLMS recommends that unions adopt written guidelines concerning such
2. Approval of Vouchers
During the audit, you advised that the president and secretary treasurer or other
union officer sign all vouchers for approval of disbursements. The two signature
requirement is an effective internal control of union funds. However, some of Local
1113's vouchers were signed by the second officer several weeks after the
disbursement was already made. This negates the purpose of the two signature
requirement. OLMS recommends that all vouchers are reviewed and signed in a
timely manner prior to the disbursement of union funds
I want to extend my personal appreciation to Communications Workers Local 1113 for
the cooperation and courtesy extended during this compliance audit.
I strongly recommend that you make sure this letter and the compliance assistance materials provided to you are passed on to future officers. If we can provide any additional assistance, please do not hesitate to call.
cc: Sheila Carr, Secretary Treasurer
John Robinson, Council A Vice President
Sheila Burke, Council B Vice President
Mary O'Connor, Accountant